I was wondering if anyone has noticed that B1 does not calculate gross profit correctly on drop shipments. B1 does not record the cost information and returns a 100% gross profit on every drop ship item. Is there a solution to this bug? Please advise. Thanks.

Steve:The Gross Profit Calculation is set up by document under System Initialization under Document Settings. What differentiates your drop shipment invoices from the regular AR Invoices? When we do drop shipments we just create a different ship to and the base price of the item is used for the gross profit calculation. If the item does not have a base price given then it will calculate a 100% gross profit.

It's not working because, by definition, drop shipments are shipments sent from the factory directly to the customer. None of the items in the drop ship order are received into our warehouse. Thus, there is no goods receipt and therefore the costs of the drop ship items are not recorded in SAP (the item cost field for the drop ship warehouse is empty).

If you use item cost as the base price for Gross Profit calculation you will indeed get 100% margin in drop ship documents. There is a current evaluation of this process in product management and it might change with the 2008 release.

The workaround I can offer is to use a price list as the base price when creating a drop ship transaction, this will insure that you have a price there which is at least close to the actual cost.

What about items that are strictly drop ship items? Their cost does not get recorded in the last purchase price list or the last evaluated price list. Have to manually input the cost information for every item on every drop shipment? That would just take too much time.

If you know the prices in advance you can save it into a &quot;static&quot; price list (Inventory>Price lists> Price lists). Once you have that defined you can base the gross profit for a specific transaction on this price list. Theoretically you could have a separate price list for each drop shipping vendor.

Even if I were to establish a price list for each drop ship vendor (not to mention how much work it's going to take to maintain and update the various prices lists), I could only select one price list in the document settings for gross profit calculation for the entire B1 system. Do I keep switching price lists every time I need to check on the gross profit margin? Wouldn't that mess up the gross profit calculation for the non-drop shipments?

I was wondering if anyone has noticed that B1 does not calculate gross profit correctly on drop shipments. B1 does not record the cost information and returns a 100% gross profit on every drop ship item. Is there a solution to this bug? Please advise. Thanks.